WPS — the first step toward introducing social benefits

WPS – a first step toward future social benefits or simply worker protection from the employer?

WPS (Wage Protection System) is an electronic wage transfer system introduced in the UAE by the Ministry of Human Resources and Emiratisation (MOHRE) to safeguard employee rights and monitor salary payments.

The system ensures that wages are paid on time and in accordance with employment contracts. Given the previous lack of any form of social welfare, until recently salaries could be paid via a simple bank transfer.

Since last year, nearly all companies in the UAE, with few exceptions, are required to upload salary data through the WPS platform. This allows the Ministry of Health and the UAE Central Bank to verify the information and approve the salary transfer.
The entire process is relatively fast and usually doesn't delay wage payments in any significant way.

In disputes where an employee claims underpayment, WPS data can be used as evidence — both for the employee and the employer.

However, commissions, bonuses, reimbursements, allowances, and similar payments are made outside the WPS system.

If an error is detected in a WPS transaction, the employer receives an automated request to update and correct the information.

Penalties for violating WPS requirements depend on the number of affected employees and the duration of payment delays – 5,000 AED per affected employee (up to 50,000 AED total for multiple cases).

The regulator may also apply additional sanctions:

• a ban on issuing new work permits
• a ban on registering new companies under the same owner
• measures affecting other companies owned by the same individual
• referral of the case to court

Companies that force employees to sign fake payroll slips will be fined 5,000 AED per affected employee.

So, it’s in the employer’s best interest to avoid mistakes to prevent unnecessary warnings and fines — and in the employee’s interest to carefully review the terms of their employment contract.